Arkansas Senate OKs proposed ballot issue to cap damages

Friday

Feb 17, 2017 at 12:01 AM

By John Lyon, Arkansas News Bureau / jlyon@arkansasnews.com

LITTLE ROCK — The Senate on Thursday approved a proposed constitutional amendment that, if referred to the ballot and approved by voters, would cap damages in civil lawsuits and require legislative approval of court rules.

In a 21-10 vote, senators approved Senate Joint Resolution 8 by Missy Irvin. The resolution goes next to the House — where a majority of the members have signed on as co-sponsors — and if approved by the House will be on the November 2018 ballot.

Under the proposed amendment, punitive damages awarded to a plaintiff in a case involving death, injuries or property damage would be capped at either $250,000 or three times the amount of compensatory damages awarded to the plaintiff, whichever is greater. The cap would not apply if a judge or jury finds that the defendant intended to cause the harm.

Damages for harm that cannot be measured in money, such as pain, suffering and loss of life, would be capped at $250,000 per plaintiff or $500,000 for the beneficiaries of someone who has died.

Also, a lawyer in a civil case could not receive a contingency fee greater than a third of the net amount recovered by his or her client.

The proposal also would require that any rule change proposed by the state Supreme Court receive legislative approval before being implemented and would give the Legislature the power to change court rules on its own initiative with a three-fifths vote in each chamber.

In 2003 the Legislature passed a law that imposed an award cap and other limits on civil suits, but the Supreme Court struck down most of the laws’ provisions in a series of court cases, saying the Legislature has exceeded its authority and violated the separation of powers between the judicial and legislative branches of government. Irvin’s proposal seeks to redefine where the court’s power ends and the Legislature’s begins.

Irvin told senators the proposed amendment would make Arkansas more competitive in attracting businesses to the state and encourage existing business to remain in the state.

“We currently have a legal climate that does not allow businesses and investments to come into our state,” she said.

Sens. Linda Chesterfield and Joyce Elliott, both D-Little Rock, asked Irvin to name one business that has declined to come to Arkansas because of the legal climate. Irvin said she could not name one but said she knew of a business that considered leaving Arkansas because of the legal climate.

Sen. Larry Teague, D-Nashville, said he worries about a child who is injured and needs medical care for the rest of his or her life.

“I don’t see $250,000 lasting very long,” he said.

Sen. Trent Garner, R-El Dorado, a co-sponsor of the proposal, said a good lawyer would be able to win compensatory damages to pay for for an injured child’s care.

Sen. Will Bond, D-Little Rock, a lawyer, said John Adams wrote that representative government and trial by a jury are “the heart and lungs of liberty.”

“Don’t fill the lungs of liberty with this smokescreen to satisfy folks out there who want to limit a fundamental right, and your right to a civil jury trial is a fundamental right,” Bond said.

Sen. Eddie Joe Williams, R-Cabot, said the people should be allowed to decide the issue.

“If the voters are smart enough to (sit) on juries and (make) a decision and we think it’s right, then they’re probably smart enough to go to the ballot box and make the same decision,” Williams said.

Gov. Asa Hutchinson, who has a law degree, said Thursday he has long been supportive of civil justice reforms, including “reasonable caps” on damages.

“But I’ve also had some criteria that there needs to be some safety valves in place, needs to be a proper balance there,” he said. “I’m going to be meeting with both sides even later today on this issue and continuing to evaluate the current proposal. I do have have some concerns about the drafting of it as to whether it meets my criteria.”

As an example, Hutchinson said that as he reads the proposal, the Supreme Court would have to seek legislative approval for changes as minor as using a different size of paper or opening court at a different time of day.

The governor also said he believes a jury should be allowed to award more than $250,000 in “egregious” cases.

The Legislature can refer up to three proposed constitutional amendments to the ballot during the session.